CORRECTED-Spanish-Cuban trade in focus as Sanchez breaks ice after three decades

(Corrects first paragraph to show is first bilateral visit by a Spanish leader for 32 years)

By Sabela Ojea and Sarah Marsh

MADRID/HAVANA, Nov 22 (Reuters) - Trade will be in focus when Pedro Sanchez on Thursday makes the first bilateral visit to Cuba by a Spanish leader in 32 years, at a time when the Communist-run island is looking towards Europe as its ties with the United States fester.

Socialist Sanchez, who is traveling with executives from two dozen companies, will meet representatives of Cuba’s fledgling private sector during the roughly 24-hour official trip and inaugurate a Spanish-Cuban business forum.

Spain is already Cuba’s third largest trading partner, with annual bilateral commerce at around $1.3 billion according to Cuban data, and shares strong cultural and historical ties with its former colony.

“Cuba is opening up and we are interested in our companies being well positioned to have access to the most important contracts,” a Spanish government official said.

Several hundred Spanish firms already have a presence in Cuba, particularly in the tourism sector, dominated by alliances between Spanish hotel chains and Cuban companies.

The main aim of the trip was to deepen relations “at a time when foreign policy towards Latin America is a big priority for the prime minister.”

Sanchez will begin his visit with late afternoon talks in Havana with Cuban President Miguel Diaz-Canel, who succeeded Raul Castro in April. He will also meet with the director of an independent digital magazine, the Spanish official said, but is not expected to talk to opposition activists.

Many world leaders have already visited Cuba as it has in recent years sought to improve relations with the West, modernise its centrally planned economy and attract more foreign investment.

They include former U.S. President Barack Obama who sought to normalise relations between the former Cold War foes.

His successor Donald Trump has rowed back, tightening the decades-old U.S. trade embargo at a time when the Cuban economy was already smarting from declining aid from ally Venezuela and weaker exports.

Relations between the European Union and Cuba have steadily improved since being formally relaunched in 2016 after a two-decade chill.

Retired Cuban diplomat Carlos Alzugaray said Sanchez’s visit was part of a rapprochement with Europe that showed that Cuba’s foreign relations “do not need to be limited to the U.S.-Cuba conflict or alliances with countries like Russia and China”.

“It is oxygen at a difficult moment,” he said.

Cuba is seeking to drum up more investment and credit lines although its cash crunch is a deterrent. It is already behind on payment to providers from Spain and elsewhere. (Additional reporting by Marc Frank; editing by John Stonestreet)